White House sends muddled message on reform

By Ben Pershing
Having spent the requisite time squabbling over why they lost the Massachusetts special election and their Senate supermajority, Democrats turned Wednesday from disagreeing about their past to disagreeing about their future.

Party factions took different lessons from Tuesday's results and what they mean for November, but the biggest split in the majority is on the way forward for health-care reform. The Washington Post writes Nancy Pelosi "struggled Wednesday to sell the Senate version of the legislation to reluctant Democrats, even as party moderates raised doubts about forging ahead without bipartisan support." The story noted that President Obama on Wednesday seemed to endorse the idea of starting over with a scaled-down bill -- he told ABC News, "I would advise that we try to move quickly to coalesce around those elements of the package that people agree on" -- but "the White House quickly moved to clarify that the president still wants comprehensive reform." (Obama also admonished the Senate not to "jam" a health-care bill through before Brown is seated, warning the chamber against doing something it had no intention of doing in the first place. In other news, Obama urged Congress not to declare war on Canada.)

The Wall Street Journal ledes with the stripped-down idea, as does Politico. The strategy has its merits to some in the majority; "some Democrats are betting that a bill packed with reform's greatest hits could jam GOP lawmakers with the tough choice of opposing overwhelmingly popular reforms or helping Democrats pass their signature domestic priority," Live Pulse reports. Roll Call says the idea is "gaining traction among some members of leadership and especially among junior members," who were presumably spooked by Massachusetts.

So what does the White House actually want? Dan Pfeiffer says the story that the White House is promoting the idea is "very wrong." But Inside Health Policy says Rahm Emanuel "called House leaders Wednesday to sell a smaller health care reform bill with insurance market reforms and a Medicaid expansion." And the New York Times reports "Republican Congressional aides said a compromise bill could include new insurance industry regulations, including a ban on denying coverage based on pre-existing medical conditions, as well as aid for small businesses for health costs and possible steps to restrict malpractice lawsuits." Whether such a measure would hang together is an open question, since putting tough new restrictions on insurance companies without a mandate that creates new customers could end up boosting the cost of insurance for everyone. Bloomberg writes "the administration is split over how to move forward, with some advocating giving Congress direction and others favoring a more hands-off approach." Jonathan Cohn wonders what happened to the cool, unflappable Obama he voted for, and writes "if health care reform is to be salvaged -- and, I'll be honest, I'm not terribly optimistic right now -- it will take something more. It's going to take the president showing the resolve and leadership that got him elected."

The other option that remains on the table is for the House to simply pass the Senate bill, with or without a subsequent second measure that would go through the reconciliation process. The votes for that option, if they exist, haven't materialized yet in the House. "In a private meeting in the Capitol just now, a dozen or more House liberals bluntly told Nancy Pelosi that there was no chance that they would vote to pass the Senate bill in its current form," the Plum Line reports. CongressDaily agrees that "House members Wednesday did not appear to have much of an appetite for the approach," and adds that "Senate Democrats Wednesday also seemed to downgrade passage of health care as a priority," as they expressed the desire to move on to a jobs bill and deficit reduction. On the message front, The Hill writes, Chris Van Hollen "said the solution might be to change the party's message by focusing on individual reforms in the massive healthcare bill," as polls have shown many of the core elements to be popular on their own.

In that interview with ABC News, Obama admitted "we lost some of that sense of speaking directly to the American people about what their core values are," and that "people are angry and they are frustrated. Not just because of what's happened in the last year or two years, but what's happened over the last eight years." Joe Klein recounts his own interview with Obama, which took place last Friday: "The President insisted, lamely, that he spends plenty of time hearing from average Americans. But he seemed to spend as much time overseas during his first year as he did traveling the country, experiencing the economic anguish firsthand. And he seems to have fallen headlong into the muck and madness of Washington, pursuing a historic goal -- universal health care -- that is certainly worthy, and central to his party's unfinished legacy, and crucial to the country's long-term economic future, but peripheral to most Americans, who have relentlessly told pollsters, by huge majorities, that they are happy with the health care they currently receive and far more worried about other things. On this defining issue, the President and his party have lost touch with the country."

The New York Times writes that Obama "on Wednesday began the daunting process of trying to turn around his presidency in a drastically altered political environment that will test his leadership, his instincts and his political dexterity as never before." Politico looks back at Obama's first year and concludes that his operating strategy "was wrong on three major counts": 1) He thought the 2008 election "represented something seismic" when it didn't; 2) He "believed that early success would be self-reinforcing," as passage of the stimulus would ease the way for passage of health care and climate change legislation; and 3) "the Obama team believed that there was something singular about the president's appeal and ability to inspire." William Greider writes that Obama "lost his innocence as the valiant young president and also lost his sixty-vote majority in the Senate. Now we will find out what the man is made of--either a true political leader or just another show horse." Nick Gillespie and Matt Welch counsel, "First and foremost, listen to the voters, especially voters who are calling for smaller government despite very tough times."

When he's not busy pondering his own future and that of the Republic, Obama on Thursday "is expected to propose new limits on the size and risk taken by the country's biggest banks, marking the administration's latest assault on Wall Street in what could mark a return, at least in spirit, to some of the curbs on finance put in place during the Great Depression," the Wall Street Journal writes. (Expect "Glass Steagall" to rocket up Google's search rankings in the coming days.) Bloomberg says "the proposals will be part of an overhaul of regulations and will specifically address firms' proprietary trading." Financial Times reports "Goldman Sachs - which runs a large proprietary trading business and which reports results on Thursday - will be watching the details closely, but the measures are more likely to threaten institutions whose operations are large and span commercial and retail operations as well as trading for their own benefit," and casts the plan as part of Obama's effort "to regain the political initiative" from ascendant Republicans.

And finally -- we hope you're sitting down for this -- it turns out John Edwards has not been completely honest with us. Are there no heroes left? "For the first time, John Edwards is publicly admitting that he is indeed the father of a 2-year-old daughter conceived with Rielle Hunter, a campaign videographer with whom he had an affair," NBC News reports, after the former White House hopeful confessed to the Today Show in a written statement. NBC adds that "Edwards is not speaking publicly today, at least in part because of an ongoing federal investigation into whether campaign money was used to try to cover up the affair."